Steel Cited as Chinese Boom Factor

China’s industrial output grew 17.9 per cent in November compared with figures for November of 2002, according to that nation’s National Bureau of Statistics.

In a statement summarized by the China News Daily of Beijing, the iron and steel industry was cited as one of four key factors in the booming growth rate.

The industrial output grew a year-on-year 17.2 per cent in October and 16.3 per cent in September. Only February, with its 19.9 percent jump, showed a bigger increase.

Four industrial sectors—electronics and telecommunications equipment; transportation equipment; machinery equipment and ferrous metals—were cited as “the major contributors to the month’s industrial growth,” according to spokesman Yao Jingyuan of the bureau. “The four sectors contributed 46.9 per cent of November’s industrial growth,” he told the China News Daily.

For the first 11 months of 2003, China’s industrial output grew a year-on-year 16.8 per cent to $440 billion.

Steel and other metals should remain in demand, as the output of cars surged 71.6 per cent in November from the figure a year earlier to 200,200 vehicles. Computer production also rose 130 per cent, according to the bureau.

“Production will continue to grow at a higher rate in the coming months and next year,” predicted Wang Zhao, a researcher with the State Council’s Development Research Centre.

The industrial growth has been part of an overall wider economic growth. “If there are no major unexpected fluctuations, the country’s economy is expected to grow 8.5 per cent for 2003,” Qiu Xiaohua, deputy commissioner of the National Bureau of Statistics, told the Beijing newspaper.

Multi-national manufacturers continue to follow the boom, as German-U.S. auto giant DaimlerChrysler in early December announced plans to form a joint venture with Fujian Motor Industry Corp. of China and China Motor Corp. of Taiwan in mid-2004 to produce its Mercedes-Benz vans on the mainland.

The joint venture has been approved by the Chinese government, DaimlerChrysler said in a statement. The three companies will invest $245 million into the joint venture, which will be located in Fuzhou, in east China’s Fujian Province.

The plant is expected to have an annual capacity of 40,000 units, starting by producing the Mercedes-Benz Sprinter, Vito and Viano vans by the end of 2005.

It is not the automaker’s first such venture in China. In September of this year, DaimlerChrysler announced a deal to invest $1.23 billion with Beijing Automotive Industry Holdings Corp. to produce Mercedes-Benz sedans and trucks in Beijing.

China Motors, which is 25 percent owned by Japan’s Mitsubishi Motor, and Fujian Motor also operate a 50-50 joint venture in Fuzhou that produces the Delica and Freeca mini vans, and the Lioncel compact sedan, which is based on the Mitsubishi Lancer.

DaimlerChrysler and South Korea’s Hyundai Motor are stakeholders in additional joint venture auto plants in China.